The Israel Defense Forces has raised objections to U.S. plans to equip Palestinian Authority Chairman Mahmoud Abbas's forces with body armor and other battle gear, an Israeli security source and European diplomats said on Wednesday.

An $86 million U.S. program to strengthen Abbas's presidential guard will include funding for four-wheel-drive vehicles, new uniforms and military training, diplomats briefed on the program said.

"The IDF's objections in this case center on equipment, such as body armor, that is liable to wind up in the wrong hands and be used for terrorism," an Israeli security source said.

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A U.S. diplomat based in the region said the United States would ensure the equipment does not end up with Fatah militants. "It's going to be done in a way that's monitored," he said.

Other diplomats said U.S. and Israeli political leaders were putting pressure on the army to set aside their reservations. The Israeli security source said the Defense Ministry would make the final decision.

Meanwhile, Israel hopes to release nearly $100 million in withheld Palestinian Authority tax revenues to Abbas by Friday, a senior Israeli official said on Wednesday.

Abbas could use the money to help make long-overdue salary payments to Palestinian public sector workers, hard hit by a Western and an Israeli embargo of the Hamas-led government.

Prime Minister Ehud Olmert has been under U.S. pressure to take steps to strengthen Abbas in his power struggle with Hamas.

The move is one of a series of steps aimed at strengthening Abbas and easing restrictions on the Palestinians that were announced following the December 24 meeting between Olmert and Abbas.

Since that meeting, Abbas's allies have complained that Israel has been undercutting him by taking its time to deliver on its promises.

Abbas, who met U.S. Secretary of State Condoleezza Rice in the West Bank city of Ramallah on Sunday, asked Washington to intervene, Palestinian officials said. Rice held talks with Olmert on Monday in Jerusalem.

"We hope to transfer the full amount by Friday," a senior Israeli government official told Reuters of the e100 million in withheld tax revenues pledged by Olmert.

Palestinian officials who have been negotiating the transfer had no immediate comment.

As part of the steps promised to Abbas, the Israel Defense Forces announced Tuesday that it recently removed 44 dirt barriers that were located near Palestinian villages in the West Bank. In recent years, the army established nearly 400 barriers and permanent roadblocks.

The IDF had previously announced it was easing the security checks at 16 central West Bank checkpoints.